Dell Inc.
Dell Inc.
Part I: Introduction/Background Summary
In 1984, Michael Dell invested $1,000 in start-up capital to register his business as Dell Computer Corporation, which was known as PCs Limited. The company becomes the first in the industry to sell directly to end-users by passing the dominant system of using computers resellers to sell mass-produced computers. Dell Computer also pioneers the industry first thirty-day money back guarantee. It became the cornerstone of Dells commitment to expand its service offerings, superior customer satisfaction, and the industries first on site service program. It also established its first international subsidiary in the United Kingdom, and raised $30 million in its initial public offering.
Part II: Problem Identification
The problem with Dell Inc. was the rapid growth within the company in their beginning stages.
Part III: Researching Internal and External Factors
Dells strengths were oriented around listening to the customers, responding to the customers, and delivering what the customer wanted. The direct relationship was first through telephone calls, then through face-to-face interactions, and now through the internet. It has enabled them to benefit from real-time input from real customers regarding products and future products they would like to see developed. The company also doesnt use reseller or retail channels because every computer is built-to-order, which allows less inventory. The direct model allows them to take the pulse of whatever market and provide the right technology for the right customers.
Dell Inc. weakness was cell manufacturing because their assembled computers were being shipped five to six days after the order was placed. It is an inconvenience for the customers to always send their computer away to have it repaired. First, they are left without internet access. Second, the time it reaches Austin, Texas, have it repaired, and shipped back can take days. The company opportunities were the Dell U.K. that open business in 1987 and in that country it was a lot of companies selling cheap computers. Dell Inc. strides on loyalty among customers and employees, and that could only be derived from having the highest level of service and performing products. Segmentation within the company enables them to measure the efficiency of the business in terms of assets use. Dell Inc. evaluates their return on invested capital in each segment, compare it with other segments, and target what the performance of each should be.
It became a great way to identify what needed to happen for them to reach their full potential in each business. The threat within the company started with selling indirect to retail channels like Comp USA, Price Club, and Sams. Dell Inc.
didnt have an idea as to whether or not they actually were making money on those companies. Inventory was also a threat because it depressed their earnings.
Part III: SWOT Analysis
Strengths
Direct Sales
Built-to-order
Designing own products
Target large companies
Efficient and flexible manufacturing operations
Great customer service and tech support
High quality computers
Low prices
Long term partnership
Complete Care Accidental Damage Service
Id tags in new computers
Weakness
Sending your computer back to Dell Inc in Austin, Texas
Cell manufacturing
Unopened products from partnerships
Handle tech support over the phone
Opportunities
Global